Microsoft's next Xbox - whatever it's called - will not feature an optical disc drive, moles have claimed. Instead, it will gain games by downloads and possibly on memory cards too.

Allegedly breaking one of the "strictest NDA" contracts ever encountered, the insiders said the console will indeed be launched in 2013, as rumoured, with a type of removable solid-state storage rather than the DVD format of yesteryear, MCV reports.

The news that console manufacturers could turn their backs on discs is worrying for already struggling high street outlets, such as Game, which may have to hope that punters will prefer to buy games on memory cards rather that suffer long download times, in order to easie its business troubles.

Microsoft declined to comment on the claims, but did release an ambiguous statement on console lifecycles:

"Xbox 360 has found new ways to extend its lifecycle like introducing the world to controller-free experiences with Kinect and re-inventing the console with a new dashboard and new entertainment content partnerships.

"We are always thinking about what is next for our platform and how to continue to defy the lifecycle convention. Beyond that we do not comment on rumours or speculation.

other places are saying it'll be like the Vita, cards sold in the shops or downloads to the consoles. All just rumors doubt they'll go download only yet to big of a risk especially when Sony have all but confirmed there sticking with Blu-rays.

a/ they could have a first time write to stop them being re sold, something not really do able with dvds etc

b/ depending on the size, would you be able to put them in a MS portable device and take them on the go? the cart would make sense if they are looking at a tablet controller, it might have a cart slot?

c/ would make the system smaller and i guess would reduce load times quite a bit.

If the abolition of the used game market would lead to faster price drops for people looking to save money I could get behind it but since microsoft are a gaggle of useless yeast infections I know that won't happen so fuck em. Might just skip the next generation.

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If the abolition of the used game market would lead to faster price drops for people looking to save money I could get behind it but since microsoft are a gaggle of useless yeast infections I know that won't happen so fuck em. Might just skip the next generation.

Cue people reacting to rumors like they're facts.

The lack of backwards compatibility this would entail would be a drag, but I'm hoping it's not for reals.

They're able to make portable HDs with storage capacity in TBs. Even tiny 3DS carts can compress several gigs. So I'm thinking that they might go for something like the Hu-Cards NEC used for the TurboGrafx 16 albeit with far more memory. However, if in fact there really is no optical disc drive included with the new console, that eliminates playback of CDs, DVDs and Blu-rays, at least by direct means. They'll likely go digital distribution model.

Trade newspaper MCV reported this morning that Microsoft is planning to drop optical disc media from the next generation Xbox, replacing it instead with a removable solid state format. The reaction online was instantaneous - a strong backlash against the idea of an all-digital console, lamenting the plight of those without superb broadband and fretting over the inevitable price hikes brought on by the end of second-hand and retailer discounting.

Spot the disconnect. What MCV reported is the end of optical media in the Xbox; what the world heard, apparently, is the end of physical retail. They're not the same thing, as anyone who's bought a PlayStation Vita - and then successfully walked into a shop and bought a game on a solid-state flash card - can tell you.

MCV shoulders much of the blame for the confusion, since having established that (according to its unnamed sources) Microsoft was proposing to replace optical discs with a solid-state format, it then proceeded to talk about the threat this poses to retail anyway - as if retail cares deeply whether it's selling games on discs or on solid-state cartridges. The next generation of consoles will, inevitably, shift some focus away from physical retail and on to digital distribution, but that will happen regardless of what format is chosen for physical distribution of games.

Still, even if that approach hadn't been taken in the original article, the reaction would probably still have been broadly the same. The industry is pretty jumpy about anything that has an impact on retail right now. It's understandable, given the GAME crisis and the overall fall in physical sales. It's just not terribly relevant to this discussion.

What we're actually talking about here, remember, is the question of whether games will be distributed on optical discs, as we currently do, or whether the next-generation Xbox will follow PlayStation Vita down the path of distributing games on flash cards. That's not a matter of digital retail strategy - next-gen games will be available simultaneously on digital download platforms and in physical retail, regardless of what form the physical product takes. Rather, it's a really straightforward question of cost:benefit.

What are the advantages of solid state? What are the disadvantages? What are the costs? Does it balance out? That's what we're really asking here. That's what Microsoft is asking, too. With solid state prices in freefall and given the problems the Xbox 360 has had with its disc drives over its lifespan, they'd be mad not to think about alternatives to discs. Thinking about it doesn't mean they'll do it, though - it just means they'll weigh the pros and cons.

What are the pros? Well, solid state memory gives you a fair few benefits in terms of the physical structure of the machine. Compared to an optical disc drive, it's small, it's got no complex moving parts, it makes no noise, generates little heat and doesn't suck up much power. From the perspective of a console hardware designer, those are all very positive things - although it's pretty obvious that they're much more attractive if you're designing handheld hardware (like PlayStation Vita). In a console that sits under a TV, plugged into the mains, power consumption, heat, noise and size are still considerations, but vastly less critical than they were in Sony's decision to drop discs from the Vita.

How about the technical aspects? In theory, solid state offers various advantages in this regard. Discs are a well-understood technology, but that doesn't stop them from being a bit of a pain in the backside - they stream data faster in some parts of the disc than others, and have long delays when you move between areas of the disc, forcing the read head to travel across the surface. They're very good at streaming large, continuous files (like movies) and pretty bad at providing access to loads of little files scattered around (like games). Developers solve this by cleverly arranging data on the disc, but it doesn't always work out; solid state should, in theory, be a much better medium to work from.

That's in theory. In practice, the term "solid state" covers a multitude of sins. It can mean the superb SSD drives which give computers a new lease of life and are beloved of anyone working with random access media anywhere, but it can also mean the cheap off-the-shelf SD card you pop into your camera, which offers far fewer advantages - if any. You get what you pay for, in essence. If you're paying for modern, high quality solid state, disc drives would be hard pressed to keep up with performance. If you're watching your budget, though, high quality optical drives will leave you in the dust.

Microsoft, of course, will be watching its budget. It's a trade-off. A good quality optical drive is expensive to build into a console, both financially and technically, but the media costs for games are subsequently very, very low. A solid state reader is cheap, but the media costs - if you're going to rival the performance of the optical drive - are high. Over the lifespan of a console, that could end up being very, very expensive indeed. Bear in mind that a single cent of added expense in game media means a million dollars of lost profit over just a few months of software sales.

It's also important to recognise where the technology now stands. It's lazy to compare solid state media with existing optical drives such as the PS3's somewhat sluggish Blu-Ray drive - instead, look at what the state of the art will be when next-gen consoles launch. Blu-Ray drive speeds have improved vastly in half a decade, and media prices have fallen dramatically. This is now a mature, cheap, attractive technology. Of course, in another half-decade, it'll look a bit old hat - which is why Microsoft is quite right to think about solid state alternatives - but if PS4 and Xbox3 launched tomorrow, the former with a Blu-Ray drive and the latter sporting solid-state, Sony would have a serious cost, capacity and performance advantage over its rival, at least for a few years.

That's a further crucial thing to remember. Microsoft isn't developing a console in isolation - it's building a product that it'll pitch against very strong rivals, and it's building it with one eye on what they're going to do. Sony will absolutely have a Blu-Ray drive in the next PlayStation. It's deeply committed to it as a movie format and as a game format, even as it pushes towards the eventual goal of digital distribution, and this time out, Blu-Ray drives are cheap, easy to build and provide strong performance.

In the face of that, could Microsoft convince consumers that not having a drive at all - no ability to play Blu-Rays or DVDs, no option of backwards compatibility, and potentially no real performance or capacity advantage - is a step into the future rather than a critical error? It's a tough call. Apple manages it, of course, but Apple's operating in a very different ecosystem with a very different set of rules.

Is Microsoft thinking about dropping the disc? Yes, of course it is. Every manufacturer knows this day is coming sooner or later. Will it happen in the next Xbox? I don't think the numbers stack up right now. The cost is high, the advantages low. The company may keep its options open with a high-performance removeable memory slot - that would make sense - but it's hard to imagine a new Xbox shipping in the next couple of years without the ubiquitous optical disc drive making a return.

If it goes pure download, I won't buy it. I hate digital distribution with a passion. I want a physical copy of my game sitting on my shelf so, in 15 years when I want to play it again, I can just grab it and put it in. Don't have to worry about whether the company will let me have access to it or whether I have filled up my hard drive.

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I think high-capacity cards might be cool of they were fast enough. Downloads only? No. That would limit their audience too much. Not enough people have fast enough internet or maybe they have caps placed on their service. Or they won't want to expand their storage to get more games, etc. I don't see it happening. Another thing I don't see happening is the name "Xbox 720".